The capital investment committee of Cross Continent Trucking Inc. is considering two capital investments. The estimated income from operations and net cash flows from each investment are as follows:
Each project requires an investment of $480,000. Straight-line depreciation will be used, and no residual value is expected. The committee has selected a rate of 15% for purposes of the net present value analysis.
|Present Value of $1 at Compound Interest|
1a. Compute the average rate of return for each investment. If required, round your answer to one decimal place.
|Average Rate of Return|
1b. Compute the net present value for each investment. Use the present value of $1 table above. If required, use the minus sign to indicate a negative net present value.
|Present value of net cash flow total||$||$|
|Less amount to be invested||$||$|
|Net present value||$||$|
2. The warehouse has a Select: larger OR smaller net present value because Select: largerOR smaller cash flows occur earlier in time compared to the tracking technology. Thus, if only one of the two projects can be accepted, the Select:tracking technology OR warehouse would be the more attractive.
For the current year sales are $1,400,000, current assets are $101,524, and current liabilities are $85,265. If sales are forecasted to increase 14% next year, and all cu...May 26 2021
The old accounting system was neither accurate nor efficient, but one company had used it faithfully for the past 40 years.faithfully _________Here is a tip:Words are cat...Jun 09 2021
Sloan Transmissions, Inc., has the following estimates for its new gear assembly project: price = $2,500 per unit; variable costs = $500 per unit; fixed costs = $5.1 mill...Jun 15 2021
What unbranched alkane has about the same boiling point as water? (Refer to Table 2.5 on the physical properties of alkanes.) Calculate the molecular weight of this alkan...Jul 31 2021
Which of the following activities at a commercial bank is NOT an operations activity?A. auditingB. check clearingC. maintenanceD. securityMay 05 2021
5 Lbm of Refrigerant 22 (R-22) is contained in a piston cylinder device. The R-22, initially at a pressure of 30 psia and a volume of 4 ft^3, is heated at constantpressur...Apr 27 2020
Depreciation methodsCharlene is evaluating a capital budgeting project that should last for 4 years. The project requires $675,000 of equipment. She is unsure what deprec...Apr 22 2020
Analyze the following two countries with linear (constant opportunity cost) production functions The production technology is given by the following unit labor requiremen...Apr 02 2020
A 6.80 percent coupon bond with 14 years left to maturity is priced to offer a 7.5 percent yield to maturity. You believe that in one year, the yield to maturity will be ...Apr 17 2020
Choose the correct answer.The first pitch of the season was(a) thrown,(b) threw,(c) throwedout by the president.Jun 28 2021